Absence of fresh cues dent markets; Sensex down 52 points

Mumbai, Dec 2 (IANS) Lack of any positive trigger coupled with negative macro-economic data points and caution over the upcoming US rate hike subdued Indian equity markets on Wednesday.

Investors were disappointed due to lack of movement over goods and services tax (GST) bill during the winter session of parliament.

Furthermore, absence of any further cues regarding a stimulus package announcement by the European Central Bank (ECB) dented sentiments and led to both the bellwether indices of the Indian equity markets ending the day’s trade in the red.

Initially, both the bellwether indices of the Indian equity markets opened on a firm note following US markets’ positive close on Tuesday.

However, initial gains were capped as investors were concerned over a slowdown in demand which was indicated by a lacklustre eight core industries (ECI) and purchasing managers index (PMI) data.

Even a bearish outlook by the Reserve bank of India (RBI) regarding scheduled cuts in key lending rates depressed sentiments.

In addition to the negative domestic cues, US based developments like the upcoming speech by the US Federal Reserve (US Fed) chairperson Janet Yellen slated for late Wednesday and Friday’s non-farm payrolls data caused volatility here.

Vaibhav Agarwal, vice president and research head at Angel Broking, said that the investors were disappointed over the lack of progress towards the GST in the parliament.

“Investors will look for cues on the US rate hike when Fed Chair Janet Yellen speaks later today,” Agarwal told IANS.

“Markets are expecting a further stimulus from the ECB tomorrow, which could result in some positive upsides.”

Investors are hopeful that the European Central Bank (ECB) will announce a stimulus package during its next monetary policy meet slated for December 3, after latest data showed that Germany’s GDP growth has slowed.

Nitasha Shankar, vice president of research with YES Securities elaborated that broader markets witnessed minor profit booking along with the headline indices.

Major Sensex gainers during Wednesday’s trade were Lupin, up 3.24 percent at Rs.1,870.70; Tata Steel, up 2.46 percent at Rs.243.50; Bajaj Auto, up 1.55 percent at Rs.2,499.40; Maruti Suzuki, up 1.47 percent at Rs.4,619.85; and Cipla, up 1.35 percent at Rs.657.25.

The major Sensex losers were State Bank of India (SBI), down 1.83 percent at Rs.244.75; Infosys, down 1.53 percent at Rs.1,060.20; BHEL, down 1.42 percent at Rs.173.10; ICICI Bank, down 1.21 percent at Rs.270.30; and HDFC, down 1.15 percent at Rs.1,211.15.